February 18 - March 6
Welcome to the Dispatch for February 18 - March 6!
This week: Chavez is dead, Cuba is in trouble, Italy elected a comedian, and Kenya’s not sure who it elected.
(Apologies for running a bit late this week - Venezuela threw a wrench in my already-behind-schedule schedule)
Chavez’s tenure in Venezuela is mixed at best. Venezuela has the lowest level of income inequality in the region, a wide variety of social programs aimed at the poor, and a vastly increased profile abroad. At the same time, Chavez’s capricious management has led oil output, increasingly the lifeblood of the Venezuelan economy, to fall dramatically, foreign investment has all but vanished, and inflation is soaring. Widespread repression of the press and of dissent, though, marred his tenure even more than his economic mismanagement or foreign adventurism.
His legacy is now in the hands of his party: with 30 days until the election, it’s a good bet Chavez’s chosen successor Nicolás Maduro will be elected to replace him - given Chavez’s outsize stature and recent passing, it will be almost impossible to run a decent opposition campaign. The question is the longer-term survival of Chavez’s party, and with it, the Bolivarian movement he championed. Bolivia, Ecuador, and Cuba have all benefited handsomely from Chavez’s oil money and international ambitions, but given Venezuela’s economic state, it’s unlikely the country can continue its role as the region’s patron without the charismatic man at the top. The death of Chavez may mark the death of the new Left in the Americas.
President Raul Castro announced this would be his final term as president, marking the end of the Castro era for Cuba. His presumptive heir is Vice President Miguel Díaz-Canel Bermúdez.
Cuba relies heavily on both the Castro legacy and on Venezuela’s largess to support the regime. Raul’s announcement and Chavez’s death mean that in five years when Bermúdez takes power, he will face a nation in uncharted territory, devoid of both its patron and its saint. After 50 years of economic mismanagement, they don’t have a hell of a lot else left.
Italy held general elections on February 26. No party received enough votes to make a majority, with a three way split emerging between the left-wing Democratic Party, Silvio Berlusconi’s center-right People of Freedom part, and the Five-Star Movement, a protest party headed by a stand-up comedian. A new election became a virtual certainty after Beppe Grillo, head of the Five-Star movement, rejected the idea of joining a coalition government.
The Italian elections have panicked investors in the Eurozone. The relative calm of the last few months was bought by the ECB’s promise to buy Euro country bonds as needed, but that was predicated on the countries’ adherence to austerity policies. At the least, Italy’s programs are on hold until the next election, and both Berlusconi’s party and the Five-Star Movement have rejected the austerity program entirely.
This shouldn’t be surprising to the Eurozone leaders, though. The austerity programs have been enormously unpopular (as well as wildly unsuccessful), and eventually the leaders implementing them were going to wind up in front of their electorates again. Even if the austerity programs made economic sense (which, again, they don’t), they’re unsustainable in a democratic system. Forcing a country to sustain several years of double-digit economic contractions is a recipe for political chaos and economic collapse - many of the Euro countries are in dire need of reform, but without some form of growth-supporting policies, reform efforts are doomed.
Kenya is awaiting the results of its presidential elections, held March 5. While flaws in the electronic tabulation system have delayed official results until at least the end of this week, early results were showing Uhuru Kenyatta, who is facing charges at the ICC, in the lead.
Kenya’s 2007 presidential elections sparked a wave of ethnic violence that left more than a thousand people dead (that incident sparked the charges against Kenyatta). While the vote was largely peaceful, the long delays and the looming prospect of a run-off have the country on edge. Kenya is also heavily invested in the fight against al-Shabaab, the Islamist militant group in Somalia. The group has recently retaliated with several attacks inside Somalia, and any period of instability will be bad for Kenya and probably bad for Somalia as well.
Thanks for joining, and my best for the week ahead!